US: Homebuilder confidence at historic highs - Wells Fargo

The NAHB/Wells Fargo Housing Market Index (HMI) rose by 5 points to 74, marking the third consecutive increase, noted analysts from Wells Fargo. According to them, the index is now at its highest level since July 1999, principally reflecting strengthening demand.

Key Quotes: 

“The NAHB/Wells Fargo Housing Market Index (HMI) rose 5 points in December to 74, marking the largest monthly gain since March. Builder confidence has not been this high for 18 years, which is a sure sign that homebuilding will ramp up if builders can secure the lots and workers they need.

“All three subcomponents increased in December. The largest was an 8 point jump in buyer traffic. The increase reflects stronger job and income growth, rising consumer confidence and exceptionally low inventories of existing homes on the market.”

“Builder confidence has soared, as builders have been able to sell homes as quickly as they can build them. The sharp rise in buyer traffic suggests the momentum will carry over into 2018.”